Problem 8-9

The Chamber of Commerce periodically sponsors public service seminars and programs. Currently, promotional plans are under way for this year's program. Advertising alternatives include television, radio, and newspaper. Audience estimates, costs, and maximum media usage limitations are as shown:

Constraint	Television	Radio	Newspaper
Audience per advertisement	110,000	18,000	30,000
Cost per advertisement	$1,500	$250	$500
Maximum media usage	11	21	13

To ensure a balanced use of advertising media, radio advertisements must not exceed 50% of the total number of advertisements authorized. In addition, television should account for at least 10% of the total number of advertisements authorized.

(a)

If the promotional budget is limited to $23,000, how many commercial messages should be run on each medium to maximize total audience contact?

Advertisement Alternatives	No of commercial messages
Television
Radio
Newspaper

What is the allocation of the budget among the three media?

Advertisement Alternatives	Budget ($)
Television	$
Radio	$
Newspaper	$

What is the total audience reached?

(b)

By how much would audience contact increase if an extra $100 were allocated to the promotional budget?

Increase in audience coverage of approximately